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Instruction In the context of sustainable human resource management, this study investigates the dual-pathway mechanism through which empowering leadership influences the retention willingness of Generation Z knowledge workers in small and medium-sized enterprises (SMEs), based on the Conservation of Resources (COR) theory. We propose that perceived organizational support and emotional exhaustion serve as parallel mediators, while proving and avoidance goal orientations act as critical moderators. Methods A multi-industry survey was conducted, collecting valid data from 387 Generation Z knowledge workers across various sectors in China. Hypotheses were tested using structural equation modeling (SEM) to analyze the direct, mediating, and moderating effects. Results The findings revealed that empowering leadership exerts an ambivalent effect on retention willingness. It simultaneously increases retention willingness by enhancing perceived organizational support and decreases it by exacerbating emotional exhaustion, with both mediating paths being statistically significant. Furthermore, employees’ goal orientation moderates this mechanism: proving goal orientation strengthens the positive effect of empowering leadership on perceived organizational support, whereas avoidance goal orientation intensifies its positive effect on emotional exhaustion. Discussion This study unveils the “double-edged sword” effect of empowering leadership, providing a more comprehensive and dialectical perspective on its impact on employee retention. The findings offer valuable insights for SMEs to implement sustainable human resource practices by tailoring empowering leadership based on employee characteristics to enhance retention and foster organizational sustainability.
Yichuan Wang (Mon,) studied this question.